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Chris Ridder  

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  • Gold Vs. European Central Bank Money Supply [View article]
    If you check the original article comparing the Gold to the Fed Balance Sheet I think the process will become more clear. The difficulty with the ECB data is that M1 grew as countries were added, where as the Fed's balance sheet was grown endogenously grown vs the exogenous growth the ECB data experienced. The view of under or overvalued depends on the time frame too. Long term investor or short term trader. Data supported a bearish short term view but looked fine for a long term horizon of 10+ years using June data. Article about the Fed data was more bullish.

    The point of ratio analysis is to show if something is higher or lower in relative price compared to the past transactions. "Fair Value" is always subjective in my opinion. Look at CAPM to get the cost of equity for the DDM; one usually gets cost of equity using regression. All statistics have a confidence interval around the point estimate, and so as a bidder I would want the number in the confidence interval that provides the lowest price and as a seller the opposite. A transaction takes place when there is a double inequality of wants. A buyer values a stock more than cash and the seller cash more than the stock, otherwise no transaction would take place.
    Aug 25, 2011. 11:58 AM | Likes Like |Link to Comment
  • Debunking 'Debunking Myths of a U.S. Monetary Collapse' Redux [View article]

    If one goes to this web page and scrolls down they can find a chart labeled "5Y CDS US$ 5yr note", about 1/3 of the way down. One can see the cost of insuring against a US default has increased. To bad I did not find this sooner to put in the article.

    One might take this issue to GMO also:

    "I would also point out this data of the average real wage in the U.S. found at the Federal Reserve Bank of Atlanta. This data shows that the real wage received by hourly workers has not been climbing consistently. This refutes the proposition that if real wealth is defined as what one can purchase with an average hourly wage then real wealth has to climb over time; which I believe is the author’s argument as he states, “My argument has nothing to do with the cost of labor being put into the production, only to compare the burden of buying something that is needed, say gasoline, with the effort one must put forth to buy it.”

    Now further down in that link there is a chart of real compensation that is shown to grow over time. However the distinction must be made between “non-wage forms of compensation -- health care benefits, employers' share of social security contributions” and wage compensation. By definition non-wage compensation cannot buy gas. If a worker is at a firm that does not supply health insurance the first example more certainly holds, especially when one considers that workers below the age of 62 cannot spend social security." from my response in February
    Aug 22, 2011. 12:04 PM | Likes Like |Link to Comment
  • Debunking Myths of a U.S. Monetary Collapse [View article]
    My response to this article:
    Aug 19, 2011. 04:04 PM | 1 Like Like |Link to Comment
  • Why Warren Buffett Would Want a Billionaire Tax [View article]
    I did write, "I don't know, maybe his motives are truly altruistic, however the effects will not be for the next generation of business builders."

    Also, why does someone over 80 wait until death to giver their wealth away? Why not give half of his 50 Billion away before he dies so that he can see the good done by it?
    Aug 17, 2011. 03:30 PM | 2 Likes Like |Link to Comment
  • AP Agribusiness Article Errs on Crop Futures [View article]
    I found the link to the original article using google:
    Aug 12, 2011. 11:33 AM | Likes Like |Link to Comment
  • AP Agribusiness Article Errs on Crop Futures [View article]
    It looks like AP revised the article after they recognized the error, since the link's article is now different.
    Aug 12, 2011. 09:59 AM | Likes Like |Link to Comment
  • Using the Corn ETF to Trade This Year's Crop Yield Projections [View article]
    Crop Report update: USDA estimated 153.0 yield in August and production was cut from 13,470 mm bushels to 12,914 mm bushels. Even with demand dropping the cut in supply was enough to boost the USDA's average corn price up by 70 cents. Futures are called limit up 10 minutes before the open.
    Aug 11, 2011. 10:22 AM | Likes Like |Link to Comment
  • CORN Bulls Have an Edge [View article]
    Thanks so much for an "eyes on the ground" update!
    Aug 9, 2011. 11:16 AM | Likes Like |Link to Comment
  • Gold vs. Fed Balance Sheet [View article]
    I'm sorry but that is not a correct assumption. You can look at this article and table in it to calculate the various values:

    "Notice that in 1980, when gold traded at $613 per ounce in the open market, the Fed could have covered its entire monetary base — that is, reserves plus cash held by the public — by revaluing its gold holdings at only $505 per ounce. Or, it could have anchored M1 — checking accounts and cash held by the public — by revaluing its gold at $1,476 per ounce. Keep in mind that gold was trading at roughly 40 percent of this amount. Or it could have anchored all of M2 — which adds short-term savings and certificates of deposit to M1 — at $5,671 per ounce.

    The Fed's gold holdings have not changed — it still holds 261.5 million ounces of gold — but the monetary base, M1, and M2 have expanded tremendously. (At present the monetary base actually is larger than M1, an indication of the Fed's frantic efforts to expand the money supply.) Anchoring the monetary base in gold today would mean a dollar price of gold of almost $8,000 per ounce. Anchoring M1 would mean over $7,000 per ounce, and anchoring M2 would mean almost $34,000 per ounce."
    Jul 18, 2011. 01:32 PM | Likes Like |Link to Comment
  • Gold vs. Fed Balance Sheet [View article]
    Great question; I did this research yesterday as a follow up. It showed the ratio higher but the chart did not look like a bubble, still not close to the highs seen in the 1970's and early 1980's.
    Jul 15, 2011. 10:20 AM | 1 Like Like |Link to Comment
  • Spreadtrum Communications: Clear or Muddy Signal? [View article]
    Here is a link to MW's Carson Block interview for the full context the statement: “we misinterpreted these points as red flags, then the company’s transparency has improved and the stock is going to go up.”
    Jul 11, 2011. 01:31 PM | Likes Like |Link to Comment
  • Signs that yesterday's rally should be sold [View instapost]
    Thanks for the notification about the SJB etf.
    Jun 24, 2011. 11:15 AM | Likes Like |Link to Comment
  • Making Sense of Sino-Forest [View article]
    "Funny how quick Kelertas [Dundee's Analyst] changes his opinion on a topic in which he was absolutely certain as recently as 6 days ago" from
    Jun 21, 2011. 11:06 AM | Likes Like |Link to Comment
  • RBC Sticks by Sino-Forest [View article]
    "The Following Sino Forest Sell-Side Analysts Should Be Terminated Immediately"

    Looks like MW wins this fight, especially after Paulson got out
    Jun 21, 2011. 11:02 AM | Likes Like |Link to Comment
  • Making Sense of Sino-Forest [View article]
    "Update: As expected, this is a hoax. Someone is very pissed with the Muddy Waters boys."

    Hoax about SEC charging MW
    Jun 21, 2011. 10:57 AM | Likes Like |Link to Comment